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Analysts: Urgency Softened On Black Friday TV Promos

NEW YORK – For TV specials, Black Friday proved once again to offer consumers significant savings, but this year the annual 24-hour shopping milestone lost some urgency as specials were spread out both earlier and later than normal, leading display analysts reported.

“Pre-Black Friday, many retailers were preparing for large sales volume by placing stacks of TVs on the floor,” noted Deirdre Kennedy, Gap Intelligence TV category analyst. “Stacks were not as depleted this year as they were at the same time last year (Best Buy, 10 a.m. Black Friday morning). Stores seemed less crowded and shoppers seemed less frantic on Friday this year, likely as a result of earlier Thanksgiving Day opening times for shoppers who wanted to get deals early, while those who were willing to comparison shop had a more leisurely Friday.”

Jordan Selburn, IHS consumer platforms senior principal analyst, said, “The push this year was price over function. There was nothing super compelling to spur demand. The activity this year was motivated more by what was cheap. It appears we are in an era right now of optimization more than innovation. That’s not to say there aren’t a lot of cool new technologies being developed. There’s a lot on the horizon, just nothing that is going to have a big retail impact this year.”

In a blog on the DisplaySearch website, Paul Gagnon, North America TV research director, noted that “Walmart had the most shocking prices,” leading with key staggered promotions of a $98 32-inch Funai TV at 6 p.m. on Thursday in the San Diego market, and a $288 50-inch Funai at 8 p.m.

“Both of those promotions were gone within minutes,” he observed. “The 32-inch was sold out at a San Diego Walmart in 15 minutes, having had about 200 units on hand, and hundreds of rain checks were handed out to other customers waiting in line to take advantage of Walmart’s one-hour guarantee.”

Noticing changing demand, Gagnon said, “Last year, a Vizio 60-inch for $688 was a hot seller, but another 60-inch Vizio for the same price this year at Walmart still was available in several locations at 8 a.m. on Friday. There was also a Vizio 70-inch for $999 that moved some volume it seems, but associates didn’t mention big demand for that particular model at several locations we visited.”

Gagnon said that on Friday morning, Walmart proclaimed having sold 2 million TVs Thursday night.

He said Vizio 60-inch and Philips 55-inch models were still available mid-day Friday at an East Coast Walmart, as well.

Crowds at Best Buy appeared to be thinner for TVs than other hot CE products like tablets and smartphones.

“Best Buy’s two key doorbusters, a 55-inch LG for $499 and a 65-inch Samsung for $999 (to counter the Vizio 70-inch at Walmart), were still in plentiful stock at three San Diego area Best Buy’s Friday morning. At an East Coast Best Buy, my colleague Stephen Baker reported that those doorbusters had sold out early,” Gagnon said.

At several San Diego Target stores, Gagnon said doorbuster TV promotions sold out quickly, “particularly a 50-inch Element for $229, although Target didn’t seem to have more than 20 to 30 in stock at any one location,” but failed to match a discounted iPad Mini for the heaviest activity.

“Increasingly, TVs will be tougher to sell in large quantities during the holidays without massive discounting to entice buyers away from their holiday meals,” Gagnon observed.

Gap’s Kennedy said retailers and manufacturers placed a total of 171 Black Friday TV print ads this year, on par with last year’s 172 ads. However, this year’s advertising was consolidated among fewer manufacturers than before, with higher store-by-store average discounts compared with 2012.

Department store Sears and electronics chain h.h.gregg had the greatest ad share among retailers, with 23 percent and 19 percent, respectively, she noted.

“Even though shoppers camp out outside of Best Buy (11 percent), Walmart (6 percent) and Target (5 percent) hoping for great deals on TVs, those retailers had far fewer models on ad than Sears, h.h.gregg, Kmart and BJ’s Wholesale Club. However, it should be noted that Best Buy placed many more TVs on sale during the event than it had advertised.”

Kennedy added that not as many Black Friday-exclusive TV SKUs were seen this year as there were last year, although LG and Samsung still had several.

“My guess is that we will likely see aggressive pricing through the end of the year as manufacturers try to out-compete each other in a struggling market,” said Kennedy.

As for the new Ultra HD TV category, Kennedy said models were not advertised heavily for Black Friday this year, and only received 4 percent of all print ads. Sony advertised its lower-priced X850 models at h.h.gregg, and Seiki placed its three budget models in ads at Sears.

“Ultra HD awareness still isn’t reaching general audiences at a very fast rate, so it appears that manufacturers targeted the bargain shoppers on Black Friday, and will continue to price their UHDTVs competitively for the holiday season,” Kennedy said. “We will likely see a greater push to educate consumers on Ultra HD throughout the coming year.”